How Kompromat brought down the democratic Austrian government on the eve of the EU elections

The collapse of the coalition government in Austria in May 2019 illustrates how to execute an effective black bag intelligence operation in the 21st century. Unlike the abortive Russian attempt in Montenegro in 2016 which harkens of “old school” methods at regime change, gunslingers did not patrol the streets of Vienna or cordon off the Austrian Parliament and the heavy hand of state is not readily visible behind the conspirators in Austria, at least at present.

The scandal centers on a video showing two Liberal Party (FPÖ) officials, then-candidate Heinz Christian Strache and Party Secretary General Johannes Gudenus in Ibiza drunkenly expressing their readiness to trade favorable media coverage for government construction tenders once in office. It emerges now that drinks served were laced with drugs to get the victims to talk.

To blame are numerous factors, but a few are of particular note. While greed, criminal intent and party loyalty are longstanding motivators for all sorts of action, into the fray comes the relatively new insatiable public appetite for fake news and scandal, and the desire to topple a democratic coalition at all costs servicing the deeply embedded non-state interests.

Intelligence Agencies infighting along party lines?

In the wake of the scandal, all FPÖ (liberal-nationalist) ministers resigned en masse, triggering a coalition and government crisis. On Monday consequently the Chancellor Sebastian Kurz did not survive a non-confidence vote by the parliament; a first for the Alpine Republic. Most critically, the portfolios of the Interior and Defense Ministries have been vacated, however, following the first thesis, this may have been the desired result.

Shortly after the liberals took over the Interior Ministry in 2017, and with it the domestic and foreign intelligence services, a purge commenced. After nearly two decades of oversight by either the Conservative or Social-democrats, “house-cleaning” of the Office for the Protection of the Constitution and Counter-terrorism (BVT) was in order.

The affair bears uncanny similarities to the Trump-FBI spat over penetration of the intelligence services by individuals resistant to changes in decades-old structures or pursuing individual political agendas. In the case of the United States, the president won, while in Austria, the Ibiza video, with its possible connections to the BVT has undone the Austrian government. It is suggested the Spanish and German intelligence services , some Austrian companies and members of the opposition party had knowledge of the tapes as early as 2017.

The former head of the German intelligence service, BND August Hanning warned that the Austrian service is not protecting secrets and information and its sources must be treated with caution. Domestically the Social Democrats, in opposition accused the new government of compromising national security. The Social Democrats were in fact responsible for many of the national security failures of the intelligence services and have consistently promoted a culture of denial is somewhat overlooked.

Following the discovery of a Russian spy in the ranks of the Austrian army warnings of hostile intelligence service penetration surfaced in growing numbers. Warnings from Western security services that Austria’s government was too cozy with Moscow—a problem judged so serious that several Western intelligence agencies curtailed longstanding ties with Austrian partners, for fear that shared secrets were going to Russia—can now be judged accurate. However, Austrian neutrality is an overarching consideration often forgotten by the Anglo-Saxon media coverage. The Alpine republic does play a sensible balancing act between the EU, NATO’s interest and Russia.

The Observer reported that there are reports of another Kremlin penetration of Austria’s security apparatus, specifically a mole in the mouthful Office for the Protection of the Constitution and Counter-terrorism, BVT for short, which is Austria’s domestic intelligence agency. A former BVT employee fell under suspicion in late 2017, which worried Western spy partners. Following the BVT-spy scandal it emerged the Austrian domestic intelligence service temporarily withdrew from the working group of the Berne Club. If the affair was the result of a domestic spat is yet to emerge, but the intended consequence is that the liberal-conservative coalition was successfully toppled.

All the above strongly suggest that the hand of an internationally funded and sponsored group, pursuing political goals is behind the affair. The planning, premeditation and strategy evident in the operation also speaks to a great deal of oversight and coordination, which the three known conspirators would most likely not possess.

In interviews conducted by the investigative journalist Gert Schmidt it emerges that the roughly seven hours of tapes were haggled over by yet unnamed reporters and stitched together to get best negative exposure of the two entrapped politicians. A SMS bidding war over the tapes “on the market” raises questions about the ethics of the so-called investigative journalism. It was claimed a payment of 600,000 euros in South African gold coins was made to the architects of the tapes.

Critical examination of the facts is replaced by sensationalism and deep rooted political hate by the left against any of the pro-nationalistic government coalition. The deliberate usage of German media to break the news in 2019 after failed attempts in 2017 furthermore incriminates the architects as well the willing media executors to embrace in the falsehood.

Even if the “project” was initiated by civil society actors, the active nature of both the entrapment scenario and its usage as de-facto political blackmail far exceed the legal limitations within which civil society operates.

Austrian Political Opponents of the Liberals?

The Israeli adviser and campaign manager Moshe Gaon finds it unlikely that a political strategist could have commissioned the video – after all, election campaigns are mostly dirty, rarely fair, and sometimes in the gray area between legal and illegal. “Campaigning is very reminiscent of war, in terms of strategies, tactics and the fight against opponents.” Professionals, such as ex-intelligence officers are often found behind such campaigns.

Additionally, utilizing the video nearly two years after both production and the domestic election makes little sense for an Austrian political party as does the argument that it severely impacted the European Parliamentary Elections. If such a video had been commissioned by one of the government opponents, e.g. the social democrats then its release would have occurred nearest to the date of the Austrian elections, similarly to the recognition of the Clinton Email Scandal in October 2016.

Tradecraft at work

For all of the mystery surrounding the affair, there is a significant amount of information and most of it evidences classic tradecraft at work. The manufacturing of the compromising material, as well as the structured and deliberate questioning show processes known to intelligence services the world over. A detailed catalog of questions for the Bosnian student, and “shepherding” the unwitting interviewees to certain answers while eliciting unmistakable responses, brings the charge of criminal entrapment to the fore. The trap possibly included drug-laced drinks to make “the targets talk”.

Beginning with the victims, one of them (Gudenus) was cased, approached and co-opted, ultimately establishing a relationship of trust with the purported niece, and enabling access to the other target, Strache. For his part, Strache remarked several times during the video that the whole matter was a trap, but this did little good. The operation was in motion and the cameras were rolling. Entrapment can be legally prosecuted; however, this has not saved Strache’s political career in the near to mid-term.

Turning to the conspirators, while much has been made of the mysterious detective convicted of drug dealing, the lawyer was undoubtedly the most important figure among the group. He alone provided bona fides and the crucially important access to the target; anyone the lawyer vouched for would be accepted by the targets, and without the lawyer’s access, the operation could not have proceeded. Surfacing now are two more characters in the dark who appear for the moment the actual “security specialists” of the quartet. The lawyer seemingly was politically and financially motivated, the others just the willing and “useful idiots”.

President of the Federal Intelligence Service (BND), Gerhard Schindler, the Ibiza affair has no intelligence background – and indirectly supports Sascha Wandl’s stories

Schindler: “The less mature technology use rather speaks against a news service. With enough limitation of a target person, no complex intelligence operation is required. Alcohol and a beautiful woman are enough. Anyone can use those resources – not just intelligence services. “

While it is possible that the female, paid a princely per diem of €7,000 (who repeatedly remarks during the video to Gudenus’ poor and barely comprehensible Russian, in highly South-Slavic accented “Янепонимаю!” or “I don’t know!”) fooled the lawyer into introducing her to the group, his above statement seems to rule out ignorance of his contact’s true identity.

It now emerges a former bodyguard for the then candidate Strache provided the intimate information to the lawyer. Unconfirmed reports suggest Strache’s the bodyguard was disgruntled over his dismissal and spoke to the lawyers who in concert with others hatched a plan.

As such, the lawyer’s susceptibility to pressure or leverage should be the starting point for determining who, or what is behind the video. Whoever contacted the lawyer or convinced him to introduce the Russian-speaker will provide the next stepping stone and at present, that person remains unknown.

The other antagonists, the detective who provided audio-video recording of the meeting, and the Bosnian agricultural student, who was reported initially as a Russian-speaking Lithuanian, may not necessarily lead directly to the architects of the affair as they provided services in exchange for payment. Maintenance of discipline and silence after the operation does not require detailed knowledge of who, or what the benefactor of the operation is/was.

The two (somewhat complementary) purposes of the operation were, (1) To turn a 500-1000% profit on the initial investment and/or (2) To cause a scandal in Austria which would, nearly certainly, bring down the FPÖ within the ruling coalition on the eve of the EU elections as suggested by the former boss of the detective.

The timing of the release of the video underlines the political motives, possibly of leftist sympathizers and publishers, and their “moral obligation” to undermine a democratically elected government, they were at odds with ideologically.

Despite not knowing who commissioned the operation, they “[were] well aware of the intended consequences and likely used a group of useful idiots to serve as the patsies in the plot”, according to former Austrian intelligence officials interviewed.

The Overlying Problem: Peer-to-peer intelligence and the retreat of the state

The emergence of the peer-to-peer economy is a recognizable hallmark of the digital age. Removing the “third party”, it is argued, improves the service, lowers cost and permits enterprises (or individuals) who face restrictive costs to enter the market and offer their services directly to consumers. Concurrent to this is the development (or re-emergence) of private intelligence gathering and contracting.

The resulting convergence of peer-to-peer economics with private intelligence providers, must ultimately lead to the shouldering of state responsibilities or activities by non-state actors. Private individuals and interests, among them intelligence and security professionals have jettisoned any recognizable government affiliation and offer their services and expertise directly to clients, both public and private interested in achieving a desired result or service. It has subsequently emerged that two of the four perpetrators provided contract services for the BVT including surveillance operations targeting drug deals.

Examining the entire affair from afar, what is striking is the role which private individuals and non-government entities played in effectively toppling a democratically-elected government in a highly modern and western nation. The ability to contract collapse of a democratically elected government in Western Europe by four private individuals, some of which possess ties to the Austrian BVT for €380,000 should and most likely has, raised alarm bells in cabinets and ministries around the world.

The threshold for such tactical intelligence operations has dropped so significantly that essentially anyone can afford to play, and that unlike 1954 in Guatemala, 1956 in Hungary, 1968 in the Czech Republic, 1973 in Chile, 1979 in Afghanistan or (unsuccessfully) 2016 in Montenegro toppling a democratically elected government is no longer the purview of states alone, but open to the highest bidder.

A Footnote

For many in the intelligence and analytical community the négligé attitude within the political culture of Austrian society permeates the affair. Many frustrated Austrian intelligence officers lament about the absence of a security culture across the government. Often jokingly referred to as the “007 complex” any reforms, overdue as they are, are resisted by the ministries.

The reasons for the denial are primarily historical. However, the cost to the Austrian republic as a result of this operation in terms of financial, political and societal stability are enormous. Bilateral relationships are damaged, trust within the already polarized political landscape has further dissipated. The financial damage to the taxpayers as a result of new elections will run into billions of euros.

The correlation between economic damage to the state, deliberate undermining of a political system with the use of fabricated and deliberate fake news should trigger a societal wide soul-searching.

The BVT and Army intelligence spying scandals, and now the toppling of a democratically elected government, should be of grave concern to all. Clearly, something is amiss in the Austrian intelligence culture. It is about time to get rid of the ghosts of ‘Colonel Redl’ and embrace the much needed structural and ideological reforms of the Austrian intelligence services.

Perhaps a good start would be to get rid of the political party affiliations of each of the intelligence services, another yet more drastic measure would be the reform of the intelligence education with a more hands-on approach instead of hiring a German as an expensive consultant to ‘advise’ the administration on how to run a domestic intelligence service.

It would be gravely concerning if any of the intelligence services would be revealed to have a hidden hand in the matter, diverting valuable resources away from protecting the state, to protecting their own inner-office, or departmental cultures instead serving the citizens of the Alpine republic. Regardless of the immediate future, this scandal is a stark reminder of the threat of fake news and a honey trap operations to democracy is today’s reality.